Microeconomics
21st Edition
ISBN: 9781259915727
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 18, Problem 7RQ
To determine
Whether the statement about the US national income is true or false.
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Question 2
Suppose that the production function is Y = 10K5L5, the population growth rate is 15 percent
and the depreciation rate is 5 percent. What is the steady state level of k if the economy saves 30
percent?
O 400
O 225
100
O 1000
Question 3
Suppose that the production function is Y 10K SL5, the population growth rate is 15 percent
and the depreciation rate is 5 percent. What is the steady state level of y if the economy saves 30
percent?
250
350
150
O 450
In the year 2014, the world's average per capita GDP was $14,517. What percent of the world's population
lived in a country with per capita GDP that was below $14,517?
O 21%
43%
56%
OOOO
73%
Show Transcribed Text
Roughly what percent of the world's population live in countries with per capita GDP lower than the average
world per capita GDP?
75%
50%
© 25%
C
10%
2. Suppose that the table below shows an economy's relationship
between real output and the inputs needed to produce that output:
LO4
Input
Quantity
Real
GDP
150.0
$400
112.5
300
75.0
200
a. What is productivity in this economy?
b. What is the per-unit cost of production if the price of each input
unit is $2?
c. Assume that the input price increases from $2 to $3 with no
accompanying change in productivity. What is the new per-unit cost
of production? In what direction would the $1 increase in input price
push the economy's aggregate supply curve? What effect would this
shift of aggregate supply have on the price level and the level of real
output?
d. Suppose that the increase in input price does not occur but,
instead, that productivity increases by 100 percent. What would be
the new per-unit cost of production? What effect would this change
in per-unit production cost have on the economy's aggregate supply
curve? What effect would this shift of aggregate supply have on the
price…
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- QUESTION 3 Figure A Figure с 60 50 40 30 20 10 0 P level O P level 60 50 40 30 20 10 0 O 10 20 10 30 40 real GDP = Q 20 real GDP = Q 30 40 ASO ADO -AD1- 50 ASO AS1 ADo 50 Figure B Figure D 60 50 40 30 20 10 8 8 8 8 8 8 60 50 40 30 20 10 0 P level 0 P level 0 10 10 20 30 40 real GDP = Q 20 30 40 real GDP = Q ADO ASO AD1 50 AS1 ASO ADO 50 03. Assuming that subscript "o" signifies the original position and subscript "1" the new position of the curves, which of these graphs depicts the scenario of a classical recession? a) Figure A O b) Figure B c) Figure C O d) Figure Darrow_forward6. LO 2 Suppose that z, the marginal product of efficiency units of labour, increases in the endogenous growth model. What effects does this have on the rates of growth and the levels of human capital, consumption, and output? Explain your results.arrow_forwardEconomics • With the following points of one input x and one output y, o Draw production possibility set satisfying free disposability o Draw production possibility set satisfying free disposability and convexity o Draw production possibility set satisfying free disposability, convexity, and constant returns to scale Data Input x output y Point A 3 Point B 2 7 Point C 3 Point D 4 6 Point E 8 LOarrow_forward
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